Tax reform, delocation and heterogeneous firms

Richard Baldwin and Toshihiro Okubo

No 15109, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: The standard international tax model is extended to allow for heterogeneous firms when agglomeration forces are important thus allowing us to study the relocation effects of taxes that vary according to firm size. We show that allowing for heterogeneity permits a given tax scheme to have an endogenously different effect on the location decision of small and big firms, with the biggest firms being endogenously more likely to relocate in reaction to high taxes. We show that a reform which flattens the tax-firm-size profile can raise tax revenue without inducing any relocation.

JEL-codes: H32 H73 R12 (search for similar items in EconPapers)
Date: 2009-06
New Economics Papers: this item is included in nep-pbe and nep-pub
Note: ITI
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (57)

Published as Richard Baldwin & Toshihiro Okubo, 2009. "Tax Reform, Delocation, and Heterogeneous Firms," Scandinavian Journal of Economics, Blackwell Publishing, vol. 111(4), pages 741-764, December.

Downloads: (external link)
http://www.nber.org/papers/w15109.pdf (application/pdf)

Related works:
Journal Article: Tax Reform, Delocation, and Heterogeneous Firms (2009)
Working Paper: Tax reform, delocation and heterogeneous firms (2009)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:15109

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w15109

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().